US private sector adds fewer jobs than expected: ADP

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Private sector employment grew by 146,000 jobs last month, ADP said — lower than the 170,000 figure that analysts expected, according to Briefing.com.

“While overall growth for the month was healthy, industry performance was mixed,” said ADP chief economist Nela Richardson.

“Manufacturing was the weakest we’ve seen since spring,” she added in a statement.

October’s job growth figure was also revised markedly lower from 233,000 to 184,000.

Economic issues have been top-of-mind for Americans in the aftermath of the Covid-19 pandemic, with lingering inflation weighing on households even though the jobs market remained resilient.

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Despite the cooldown this month, the Federal Reserve’s moves since September to lower interest rates should eventually give the world’s biggest economy a boost.

Looking ahead, analysts are eyeing a government employment report due Friday.

Economists Carl Weinberg and Rubeela Farooqi of High Frequency Economics noted that the ADP figures are not always a good predictor of official data, though they give a sense of the big picture.

“Right now, that picture is one of still substantial increases in jobs by a fast-growing economy but a slowing trend in job creation,” Weinberg and Farooqi said.

They expect job growth to slow, but continue next year.

On Wednesday, ADP noted that pay growth for workers who stayed in their jobs climbed for the first time in over two years on an annual basis, to 4.8 percent.

For those who changed jobs, wage growth picked up to 7.2 percent.

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Manufacturing lost 26,000 jobs in November while employment in areas like education and health services remained resilient.

ADP noted that “strong hiring at large employers led this month’s growth.”

If incoming data shows further slowing in underlying jobs growth, the Fed could be nudged towards cutting rates for a third straight meeting this month, said Samuel Tombs, chief US economist at Pantheon Macroeconomics.